Another U.S. pharmaceutical company is under fire for putting excessive profits ahead of making a drug widely and easily accessible to those who need it.
Gilead Sciences Inc., which manufactures the hepatitis C drugs Harvoni and Sovaldi, is being accused by two senior U.S. senators of setting the price of the drugs to maintain high list prices instead of basing prices on how much it cost to develop them.
The two drugs made Gilead Sciences Inc. $13.3 billion in the U.S. over the last year.
The claims come from Senators Rand Charles Grassley, an Iowa Republican, and Ron Wyden, an Oregon Democrat, in a report they released which is based on 20,000 pages of internal company documents, interviews with experts and data from U.S. health programs.
The senators say the company set the price of its first drug, Sovaldi, at $84,000 for a 12-week course with the strategy of later being able to charge a high price for Harvoni, its follow-up medicine which came on the market a year after Sovaldi with a list price of $94,500.
Wyden says, “Gilead pursued a calculated scheme for pricing and marketing its Hepatitis C drug based on one primary goal, maximizing revenue, regardless of the human consequences. There was no concrete evidence in e-mails, meeting minutes or presentations that basic financial matters such as R&D costs or the multibillion-dollar acquisition of Pharmasset, the drug’s first developer, factored into how Gilead set the price.”
In the past, Gilead has not emphasized research costs as a major factor in its price setting but has said the drugs represent a significant medical advance and are much cheaper than the cost of caring for complications from the liver infection.
The company acquired Sovaldi, in an $11 billion acquisition of Pharmasset Inc. in 2012. Harvoni was approved by the Food and Drug Administration in October 2014.
The report says, “Over the eight months Gilead spent determining the price of Sovaldi, the company repeatedly made clear its primary focus was outmaneuvering potential competitors to ensure its drugs had the greatest share of the market, for the highest price, for the longest period of time.”
The Senate investigation also found that Gilead initially “refused to significantly lower the net price” for Sovaldi even after insurers and other payers restricted access to the drug.
Prices only dropped for Gilead’s drugs after competitor AbbVie Inc. entered the market with similar drugs in December 2014. The senate report says "that led to the nation’s largest drug benefit manager, Express Scripts Holding Co., making AbbVie’s drug Viekira Pak the preferred treatment for the most common sub-type of the virus."
Gilead spokesperson Cara Miller has not returned requests for comment.